Saturday, May 21, 2016

As Tsai Ing-wen takes over Taiwan, the reality sets in

Taiwan’s Tsai Ing-wen handily
won the January election to become the next president of Taiwan. Now comes the
hard part; on May 20 she will take office and govern.

Tsai ran on the platform of keeping
the status quo but not accepting the one China principle and not recognizing
the 1992 consensus. She is going to find out that there is a price to having
status quo across the Taiwan Straits.

“One China” is short hand for
the recognition that Taiwan is part of China, a fact confirmed by the U.N.
Resolution No. 2758 enacted in 1971. The “1992 consensus” refers to the last
summit meeting between the representatives of Beijing and Taipei held in Hong
Kong where both sides agreed to “one China” but each according their
interpretation as to exactly what that means.

The mutually accepted
ambiguity inherent in the consensus allowed Ma Ying-jeou to establish closer
ties and economic cooperation with the mainland when he came into office in
2008.

When Ma came into office,
Taiwan was in terrible shape. Chen Shui-bian, Ma’s predecessor mismanaged the
economy and tried hard to agitate for the U.S. to step in and confront the
mainland, a move that only deepened the antipathy of then President, George W.
Bush, had for Chen.

There was no communication or
economic linkage between Taiwan and the mainland and no respect for Chen. Aside
from his hard-core supporters, it was clear that Chen and his family was
thoroughly corrupt. As soon as Chen was out of the office and lost his immunity
from prosecution, he was sent to jail convicted of a variety of criminal
charges.

The eight years under Ma has
dramatically altered the cross-strait relationship.Cross-strait trade has increased to nearly
$190 billion in 2015. Since both sides signed the Economic Cooperation
Framework Agreement (ECFA) in 2010, bilateral trade has increased by 70% and
surplus grown from roughly 2 to 1 every year to more than 3 to 1 in Taiwan’s
favor in 2015.

Under Chen’s regime, there
were no tourist from the mainland and no direct flights. Now there are 890
cross-straits flights per week from 61 destinations on the mainland. With over
4 million tourist visits, mainland visitors make up 40% of all visits and half
of Taiwan’s earnings from tourism.

Unhappily for Ma and his
party KMT, he failed to fully explain the benefits of cross-strait
collaboration and because of the global financial crisis that coincided with
his coming into office, Ma under-delivered on the economic benefits of economic
cooperation with the mainland as compared to his campaign promises.

Instead of growing closer to
the mainland, the people of Taiwan, especially the younger generation became
more antagonistic over the fear of mainlanders dominating the Taiwan economy.
It did not helped that the younger generation has been raised on textbooks
revised under Chen’s administration—textbooks that refute the historical and
cultural ties between the people of Taiwan and the mainland.

Tsai’s dilemma will be
finding a way of pleasing her core supporters that do not believe in
collaborating with the mainland while somehow maintaining the status quo across
the straits. Beijing has already hinted to Tsai that there is no automatic
granting of status quo if she is unwilling to concede to the one China
principle.

Recently Ma’s lame duck
government received an invitation from the World Health Organization to send
observers to the World Health Assembly, an annual gathering of nations to
discuss problems related to public health. The invite was referred to Tsai’s
incoming administration to handle.

For the first time since 2007
when Chen was president, the invitation explicitly mentioned that the
invitation was extended to Taiwan under UN resolution 2785. The significance is
that accepting the invitation is equivalent to the Tsai government accepting
the principle that Taiwan is part of China.

Now that KMT has become the
opposition, they are jeering at Tsai’s having to handle the first of likely
many hot potatoes. They said that DPP used to castigate Ma for agreeing to the
1992 consensus and now Tsai doesn’t even have the advantage of ambiguity as
cover.

Tsai will feel the sting of Taiwan’s
lacking international recognition as a sovereign state in other ways.

Recently, a group of citizens
of Taiwan were arrested in Kenya and accused of conducting some kind of scam.
Before Taipei can intervene, the accused were sent to Beijing for adjudication
because Kenya like most members of the UN has no diplomatic relations with
Taipei.

Even Japan has not treated
Taiwan kindly. Recently, the Japanese Navy seized a Taiwanese fishing boat and
demanded the posting of bail bond before releasing the captain of the boat.
Some people in Taiwan observed that Japan would not have dared to seize a PRC
fishing boat much less demanded a ransom.

On the top of it all, the
latest imbroglio being debated in Taiwan is whether Chen Shui-bian will accept
Tsai’s formal VIP invitation and attend Tsai’s inaugural banquet. One view is
that Chen has been released from jail on medical grounds. Therefore if he is
well enough to attend the public event, he is healthy enough to be sent back to
jail post haste.

Another view is that Chen’s
presence on the head table among former presidents will draw all the media’s
attention and deprive Tsai the limelight that she deserves. Chen’s son publicly
questioned as to why Taiwan can’t be more like the U.S. where former presidents
are honored as a group irrespective of political party affiliation, overlooking
his father’s criminal record.

The fountain of pettiness
from the Chen’s family never runs dry and continues to spew forth and feed the Taiwan’s
morbid curiosity about the former first family.

Tsai is trained in economics
and international law. She is bright enough to know that if she cannot
successfully stimulate Taiwan’s economy, everything else won’t matter much and
she will be a likely one-term president.

The KMT is in such tatters
that it’s an opposition that won’t be bothersome to her. Her concern will be
finding a way to continue to collaborate with Beijing. Taiwan’s economy is
integrated with and dependent on the mainland. She won’t be able to do much to
Taiwan’s economy without being an integral part of China’s economy.

The people of Taiwan and on
the mainland will be listening intently to her forthcoming inauguration speech
to understand her vision of a thriving Taiwan future in interesting times.

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About George Koo

George came to the U.S. as a child from China, grew up in Seattle and educated at MIT, Stevens Institute and Santa Clara Univ.
Dr. Koo has recently retired from a world leading advisory services firm where he advised clients on their China strategies and business operations. He is founder and former managing director of International Strategic Alliances.
He is a former member of the board of directors of Las Vegas Sands and a current director of New America Media.
Dr. Koo is a frequent speaker in various public forums on China and U.S. China bilateral relations. He writes for Pacific News Service (New America Media) on issues relating to Chinese Americans and to U.S.-China relations.
He is a member of Committee of 100 and Pacific Council for International Policy.